Elon Musk’s companies, X Corp. and xAI, have filed suit against Apple and OpenAI, alleging that their strategic alliance unlawfully consolidates influence over both generative AI development and smartphone distribution channels.
The lawsuit, filed on August 25, 2025, in the U.S. District Court for the Northern District of Texas, alleges that Apple and OpenAI have engaged in anticompetitive behavior that suppresses innovation, restricts consumer choice, and unfairly advantages ChatGPT over rival platforms like Grok and X.
Plaintiffs’ Core Claims
The lawsuit, titled X Corp. and X.AI LLC v. Apple Inc. et al., centers on a series of allegations that Apple and OpenAI have formed a secretive, exclusive partnership that unfairly tilts the AI market in favor of ChatGPT.
The plaintiffs are seeking billions of dollars in damages and structural remedies to restore competition.
According to the complaint:
Exclusive Integration: Apple, described as a “monopolist in the U.S. smartphone market” with a 65% share, has allegedly made ChatGPT the only generative AI chatbot integrated into iPhones via Apple Intelligence. Users activating Apple Intelligence are not offered alternatives, effectively locking out competitors like Grok.
Monopoly on User Data: The deal allegedly gives ChatGPT privileged access to “billions of user prompts originating from hundreds of millions of iPhones,” which the plaintiffs argue provides OpenAI with a significant advantage in training its models and reinforcing its dominance.
App Store Bias: The lawsuit claims Apple manipulates App Store rankings and editorial features to suppress rival apps. On August 24, 2025, ChatGPT was the only generative AI chatbot featured in the App Store’s “Must-Have Apps” section, while Grok and X—despite ranking #2 in Productivity and #1 in News, respectively—were excluded.
Suppressed Competition: The plaintiffs argue that Apple and OpenAI’s actions have harmed competition in both the generative AI and smartphone markets, reducing “customer choice, competition, and marketwide innovation and investment.”
Key Data from the Lawsuit
The complaint includes specific metrics to illustrate the scale of the alleged monopoly and its impact:
- Grok app: 4.9-star rating from over 1 million reviews
- Grok downloads: 50 million+
- ChatGPT downloads: 938 million as of July 2025
- ChatGPT revenue: $2 billion in August 2025
- OpenAI U.S. market share: 80–85% in 2024
- Global private investment in generative AI: $33.9 billion in 2024
- U.S. share of GenAI investment: $25.4 billion—more than China, the E.U., and the U.K. combined
Musk and xAI publicly criticized Apple’s practices in posts made on X. Musk wrote:
A million reviews with 4.9 average for @Grok and still Apple refuses to mention Grok on any lists
xAI added:
Thanks for highlighting those impressive numbers—1M reviews at 4.9 stars along-side 50M+ downloads is incredible validation from users. We’re on the top free apps chart at , but curated features could boost visibility more. Onward to maximizing truth-seeking AI!
These posts reflect growing frustration over Apple’s editorial decisions and perceived bias in app promotion.
Industry and Legal Context
This lawsuit follows Musk’s earlier accusations, made on August 12, 2025, that Apple was “playing politics” by favoring OpenAI in App Store rankings. Apple responded by stating that its App Store is “fair and free of bias,” with curated lists selected by experts using objective criteria.
The case also builds on Musk’s long-standing feud with OpenAI CEO Sam Altman, dating back to their split after co-founding the company in 2015. Altman responded to Musk’s latest claims by criticizing Musk’s management of the X platform, while OpenAI maintained its focus on product development.
Legal Remedies Sought
The plaintiffs are requesting:
- Injunctive relief to halt ChatGPT’s default integration
- Algorithmic transparency in App Store rankings
- Structural remedies to restore competition
- Monetary damages for lost visibility and market share
Broader Significance
This lawsuit adds to the growing legal scrutiny of Apple’s market practices, echoing themes from the Epic Games litigation and the U.S. Department of Justice’s antitrust suit against Apple.
If successful, the case could reshape how AI platforms are distributed and promoted within closed ecosystems, potentially opening the door for broader competition in consumer AI.